T-Mobile continues its aggressive campaign to revolutionize how the mobile market works and has now killed overage charges, challenging other carriers to follow suit.
After announcing some new pricing plans and products last week that would give mobile customers more control, T-Mobile CEO John Legere went at it again this week and his latest announcement could overhaul the entire U.S. telecom industry.
The company announced that it has decided to drop overage charges, i.e. the extra fees that subscribers have to pay when they exceed their voice, text, or data plans. According to T-Mobile, more than 20 million Americans had to pay such punitive charges in 2013, and the three largest carriers in the U.S. take more than $1 billion every year by making their customers pay such overage fees.
"Charging overage fees is a greedy, predatory practice that needs to go," stated Legere. "Starting in May for bills arriving in June - regardless of whether you're on Simple Choice, Simple Starter or an older plan, we're abolishing overages for good. Period."
Moreover, T-Mobile is also challenging the other U.S. major carriers to follow suit and waive their overage fees as well, and has even started a petition for consumers to make their voices heard.
"Today I'm laying down a challenge to AT&T, Verizon and Sprint to join T-Mobile in ending these outrageous overage penalties for all consumers - because it's the right thing to do," explained Legere. "Overage fees are flat out wrong. Agree with me? Join me in putting this challenge to all the major national carriers by signing my petition on Change.org."
Overage penalties are among the most common and infamous wireless industry practices, shoving surprise bills down consumers' throats in the form of overage charges. More specifically, carriers lure customers with entry-level plans available for a low monthly fee, offering a fixed amount of domestic minutes, texts, or data, depending on the plan. Once consumers exceed those limits, however, they're slammed with dramatically higher rates, often times outrageous.
What T-Mobile is trying to do here is eliminate these dramatically higher tariffs that hit consumers when they exceed even by just a little the limits of their plans. T-Mobile gives AT&T's entry-level plan as an example: the plan costs $45 per month, but users will pay as much as $125 simply if they use the average amount of data for a U.S. smartphone user, which is 1.5GB per user.
"The worst thing about these overage fees is that they're often inflicted on those who can least afford them. As an advocate for consumers, we're putting a stop to that," added Legere. "I personally won't be satisfied until we obliterate this shameful practice from the entire wireless industry."
This strategy is T-Mobile's latest move part of its wider effort to be the "Uncarrier" and go against the common practices in the U.S. telecom industry in order to favor the consumer. If you agree with this proposition, head over to Change.org and sign T-Mobile's petition to demand AT&T, Verizon, and Sprint to stop charging overage fees. The petition already has 17,500 signatures at the time of writing, but it remains to be seen whether it will actually change anything.
